Maximizing value and Minimizing risks

Whether you are entering into new markets or contemplating an acquisition, joint venture, or merger, we can help you structure your transactions to ensure that you achieve all your key strategic objectives.

Our dedicated Mergers and Acquisitions (M&A) strategists offer sector-focused advice on the M&A process, enabling corporations to optimize operational efficiency. We maximize transaction value and minimize risk while leveraging our international expertise in M&A. By keeping abreast of the latest business practices, our highly-qualified team can assist you with tailored solutions specific to your corporate finances and deals.

Our breadth of experience across a wide array of industries and our in-depth insights enable us to add real value to all your M&A transactions. From developing the right strategy to identifying issues and implementing changes, we assist our clients throughout the entire transaction life-cycle and help accelerate business growth.

While there are many benefits to entering a new market or performing an acquisition, joint venture, or merger, there is a lot of preparation that needs to be done to ensure that you are optimizing operational efficiency. It isn’t enough to simply want to combine forces; you have to set your organization (s) up for success. For this reason, you must understand how to maximize transaction value while minimizing risk. 

Read on for answers to some of the most asked questions about mergers and acquisitions.

1. What are Mergers & Acquisitions?

Mergers and Acquisitions (M&A) are the processes by which two or more companies combine into one. However, the two approaches are slightly different. 

Mergers happen when two companies join together, usually because they are around the same size and understand the advantages of joining forces. These advantages may include the ability to increase sales, capabilities, or efficiencies. When companies agree to merge, they approach the terms of the deal in a friendly and mutually agreed-upon manner as they will be equal partners in the new enterprise.

On the other hand, an acquisition happens when one company purchases another business and brings it into its operations (or “acquires” it). Depending on the relationship between the companies, an acquisition can sometimes be a friendly process, but it can also potentially be hostile. Unlike during a merger, the two companies will not be equal partners in a new enterprise, one of them will come into the fold of the other one. 

Ultimately, the result of these processes is the same; however, the relationship between the organizations will be different depending on whether a merger or acquisition transpired. Utilizing company formation services is recommended for both mergers and acquisitions. 

2. What are the benefits of mergers & acquisitions?

There are many reasons why companies would decide to do a merger or an acquisition; however, usually, it has to do with being more efficient or expanding capabilities. For example, by combining into one organization, a business can benefit from an increased economy of scale or market share – this is especially true if they are in the same industry. 

Other frequent benefits include expanded distribution capabilities because a merger or an acquisition often broadens a company’s geographic reach, network, or service area. Furthermore, reducing staffing redundancies can help decrease labor costs. Not to mention that by expanding the labor pool from which they can draw, a company can benefit from improved labor talent. 

Finally, after a successful merger or acquisition, companies should find themselves in an enhanced financial situation as combining the finances of two (or more) companies is usually more beneficial than each standing alone which, in turn, allows for new investments and opportunities.

3. What services are beneficial for a merger or an acquisition?

Regardless of whether it is a merger or an acquisition, there are a lot of moving parts that have to happen before the process is completed. For this reason, there are plenty of other services that should also be part of the overall process. Some of these include: 

• Financial, Tax, Technology & Legal Due Diligence: identifies and examines any risks related to a potential transaction.
• Business Restructuring: the objective is to protect your investments, maximize recoveries and enhance a company’s financial performance – including Financial Restructuring, Organisation Restructuring, Divestment and Spin-offs, Debt Restructuring, Cost Reduction, and Legal Restructuring. 
• Transaction Valuation: ascertains the value of your assets and drives your company’s business goals – including Transaction Valuations, Financial Reporting Valuations, and Portfolio Valuation Advisory. 
• JV/Share Purchase & Subscription Agreement: provides the legal framework for the sale.
• Private Equity, Debt & Equity Syndication: effective strategies to help maximize capital and gain deeper insight into the nature of transactions:

• Private Equity Funding includes Collateral Preparation, Investor Shortlisting, Commercial Term Sheet, and Due diligence and closure.
• Debt Syndication includes Growth Financing, Bridge Funding, and Asset Financing. 
• Also can include Project Identification & Feasibility, Risk Analysis, Financial Modeling, Evaluation of Funding Options, and Negotiating Terms Sheet. 
• Deal Sourcing/Partner Search: identifying key strategic partnerships.
• Post-Merger Integration: strategic solutions to make the post-transaction integration process successful.
• Services include: Integrating strategy and approach; Setting up the integration program; Developing and validating the synergy case and realizing it; Developing a blueprint for the new entity’s management structure; Mobilising and coordinating the project teams.

4. Why is risk advisory important in mergers and acquisitions?

When it comes to business, some level of risk is unavoidable; however, you want to be mitigating it as much as possible and ensuring that you have a comprehensive understanding of what you are getting yourself into – particularly when it comes to mergers and acquisitions. For this reason, it is highly recommended that you use risk advisory services. In order to make the most of your merger or acquisition, you need to be able to recognize and control risk as efficiently as possible in order to realize the full potential of the new organization. Risk advisory services will also aid you in maximizing your value creation while protecting the interests of the various stakeholders. 

If you are considering a merger, acquisition, or joint venture, you want to make sure you are doing everything you can to set your organization up for success. To ensure that you are well-positioned to achieve all your key strategic objectives, reach out to our dedicated Mergers and Acquisitions (M&A) strategists today to learn how we can create a tailored solution for you.